Smarter Convert - $21 Million Subscription

The Smarter Web Company (AQUIS: SWC | OTCQB: TSWCF | FRA: 3M8) is pleased to announce the launch of Smarter Convert, a strategic, interest free capital-raising initiative structured as a convertible bond, denominated in Bitcoin. This innovative instrument has been fully subscribed by TOBAM for $21 million, a respected institutional investor and independent, employee-owned asset management firm founded in 2006 by Yves Choueifaty. TOBAM has been actively engaged in the Bitcoin space since 2016.

Smarter Convert has been developed in partnership with TOBAM. The structure is designed to align incentives across stakeholders while offering appropriate downside protection. TOBAM has subscribed through three of its managed funds. It is intended that further bonds could be issued in the future, to other investors, including TOBAM, at future market prices, using this same structure.

On 05 August 2025 the closing share price of The Smarter Web Company equity was £1.95 per share. Therefore, the Reference Share Price (“Reference Share Price”) for this initial tranche of Smarter Convert is set to £1.95. The Reference USD Exchange Rate (“Reference USD Exchange Rate”) for funds received by the Company in USD is 1.3288 GBP/USD.

Key terms of the Smarter Convert instrument include:

Conversion Share Price (“Conversion Share Price”): Investors may convert into equity at a 5% premium to the Reference Share Price.
Forced Conversion: After an initial 6-month period, the Company has the right to force conversion into equity if the share price trades 50% above the Conversion Share Price, for a period of 10 trading days.
Downside Protection: If the bonds are not converted within 12 months, the Company will repay 98% of the bond value to investors.

The bond's principal value is denominated in Bitcoin. This means the amount repayable at maturity (if not converted into equity) will be adjusted based on the price of Bitcoin at that time. If the value of Bitcoin increases, the repayment amount increases; if the value of Bitcoin decreases, the repayment amount decreases.

However, the Conversion Share Price is fixed in GBP, as stated above.

Smarter Convert offers the potential to raise capital at a premium to the current market price, while also allowing the Company to increase its Bitcoin holdings. However, the total amount of Bitcoin to be acquired through this initiative will be capped at approximately 30% of the Company’s existing unencumbered treasury Bitcoin holdings, ensuring prudent and measured growth.

Scenario Analysis: Smarter Convert - Illustrating Potential Outcomes

To help investors understand the potential impact of Smarter Convert, two illustrative scenarios have been modelled - representing both downside and upside outcomes:

“Worst Case” Scenario If the share price does not rise meaningfully over the next 12 months, it may not be attractive for investors to convert their bonds into equity. In this case, investors may request repayment of 98% of the bond’s value at maturity. The Smarter Web Company would retain the remaining 2% - this effectively offsets expenses incurred from using this capital-raising initiative.

“Best Case” Scenario If the share price rises above the Conversion Share Price, investors may choose to convert their bonds into equity. Alternatively, if the share price trades at or above a 50% premium to the Conversion Share Price for at least 10 consecutive trading days after the initial six-month period, the Company has the right to force conversion.

In this scenario, The Smarter Web Company achieves a capital raise at a premium based on the Conversion Share Price being higher than the Reference Share Price, resulting in approximately 5% less dilution compared to a traditional equity raise, at the issue date of the bond.

Impact On Shares In Issue

If all bonds are converted into equity a total of 7,718,551 shares will be issued. This is calculated at $21 million converted into equity at the Reference USD Exchange Rate divided by the Conversion Share Price.

Yves Choueifaty, CEO of TOBAM said “TOBAM is driven by a commitment to long-term alignment - combining discipline in execution with clarity in design and a drive for innovation. Smarter Convert exemplifies this - offering prudent downside protection, premium equity participation, and a Bitcoin-denominated structure that reflects our conviction in Bitcoin as the next cornerstone of trust. We greatly valued the constructive dialogue with Andrew and his team in shaping this transaction, which sets a new benchmark for responsible, innovation- driven capital raising.”

Andrew Webley, CEO of The Smarter Web Company said “We have been building our Bitcoin- backed balance sheet with laser focus, and today’s announcement marks yet another first for the UK capital markets. I am grateful to Yves and his team for their collaboration and support in bringing this innovative structure to life. We believe that this new structure will open up a new segment of capital for the Company and complement our existing funding strategies as we pursue our ambition to make The Smarter Web Company into one of the largest publicly listed companies in the UK.”

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